Fortress Private Equity

Fortress Investment Group| Private Equity Profile

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Fortress Investment Group is one of the 50 largest private equity firms, according to Private Equity International's rankings.  Fortress Investment Group LLC was founded as a private equity firm in 1998 by Wesley R. Edens, a former partner at BlackRock Financial Management, Inc.; Robert Kauffman, a managing director of UBS; and Randal A. Nardone, also a managing director of UBS. Fortress quickly expanded into hedge funds, real estate-related investments and debt securities, run by Michael Novogratz and Pete Briger, both former partners at Goldman Sachs.

Story#1: Fortress Takes $5 Billion Buyout Loss

A new report reveals that Fortress Investment Group has had a pretty rough last half decade.  The private equity and hedge fund firm apparently took a $5 billion loss on its private equity funds since 2005.  That's more than KKR or Blackstone Group's losses combined...almost $3.5 billion more than both those firms' losses. 

Fortress's head of private equity, Wes Edens, decided not to open up a fund last year and will launch a new one in the coming months.  But at least one institutional investors has said he won't be investing in Fortress funds unless they can prove better than the most recent private equity funds.

Source

Story #2: Fortress to Select Former Head of Fannie Mae as CEO

Fortress Investment Group (FIG.N), among the largest private equity and hedge fund firms, is expected to name former Fannie Mae (FNM.P) boss Daniel Mudd as its chief executive, the Wall Street Journal reported Friday, citing a person familiar with the matter.
In a surprise move, Mudd, a Fortress director, would replace Fortress co-founder and top stockholder Wesley Edens. Fortress officials were not immediately available for comment.
The appointment would relieve Edens and other top executives of management responsibilities, allowing them to focus on a portfolio hit by the financial crisis and to seek out new investments, the paper said, citing the unnamed source. (Source)

Story #3: Fortress Clashes in Talks Over Florida East Coast

Fortress Investment Group LLC is deep in discussions with lenders to refinance a critical $1.6 billion loan on real-estate and railroads company Florida East Coast Industries Inc., according to people familiar with the talks. There is only one wrinkle: One of those lenders happens to be Fortress Investment Group.
New York-based Fortress, a private-equity and hedge-fund firm with $26.5 billion in assets under management, has until July 27 to work out a plan, when the loan matures and Florida East Coast must pay back the amount. People involved in the negotiations say that the company wants to extend the loan, and that it is expected to reach an accord that will delay the maturity and increase its interest rate.
But the people involved in the discussions say the talks have been complicated because Fortress sits on both sides of the negotiating table: The company already has a $2 billion equity investment, made when it spent $3.6 billion to purchase Florida East Coast at the height of the credit bubble in 2007. But since then, separate investment funds managed by Fortress have been buying up large chunks of the company's debt. They are now the company's largest lender, holding a $600 million position. Source

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